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Blog Posts: lacey act

Illegal logging drives deforestation in many countries, robbing national governments and local communities of valuable income and contributing to global biodiversity loss and climate change. Apart from its environmental and economic damage, illegal logging can fuel corruption, and is sometimes linked to organized crime and violent social conflict.

A new guide, Sourcing Legally Produced Wood: A Guide for Business, provides four actions companies can take to source legal wood. The guide aims to help companies avoid illicit logging in their supply chains—both for the good of the world’s forests and their own bottom lines.

Brazil is one of the most biologically diverse countries in the world. What is less known is that the country is the fourth largest industrial roundwood (timber left as logs, not sawn into planks) and wood pulp producer and ninth largest paper producer in the world. Brazil’s forest sector contributed 5 percent to the national gross domestic product in 2012. Brazil’s forests are not only home to communities and a haven for biodiversity, they are also part of the country’s economic backbone.

Brazil’s government has made impressive progress towards balancing forest protection and production. In 2012, deforestation in the Brazilian Amazon dropped to its lowest rate in more than two decades. Brazil’s National Institute for Space Research has pioneered the use of satellite data to prevent illegal logging. And the forest sector uses the Forest Source Document system (Documento de Origem Florestal, DOF), a sophisticated electronic system to track the wood flow throughout the supply chain.

Despite these positive steps, illegal logging and associated trade in the Amazon continues. Beyond the negative social and environmental impacts, illegal logging poses a serious problem for businesses producing legal wood products. With a price difference of up to 40 percent, legal wood simply cannot compete with cheaper illegal wood.

To reduce illegal logging and support the legal actors in the forest sector, Brazil must strengthen its forest control systems and policies.

The global market for wood and other forest products is changing quickly. The industry has long struggled to address the problem of illegal logging, which damages diverse and valuable forests and creates economic losses of up to $10 billion a year. In some wood-producing countries, illegal logging accounts for 50-90 percent of total production.

But recent developments indicate that we may be turning a corner: Illegal logging rates worldwide have declined by about 20 percent since 2008.

This was the topic on everyone’s minds at the recent Forest Legality Alliance meeting in Washington, D.C. This meeting brought together nearly 100 members and experts representing a wide array of companies, trade associations, NGOs, and governments involved in the harvest, manufacturing, and trade of legally produced forest products.

This post was co-authored with Carita Chan, an intern with WRI's forests initiative.

As the crisis of tropical deforestation reaches a new level of urgency due to forest fires raging in Indonesia, an important question is how can the world satisfy the growing demand for forest products while still preserving forest ecosystems? This week, some of the world’s largest companies will join U.S. and Indonesian government officials in Jakarta at the Tropical Forest Alliance 2020 (TFA 2020) meeting to discuss this issue.

The meeting comes three years after the Consumer Goods Forum (CGF), a group of the world’s 400 largest consumer goods companies from 70 countries, announced their commitment to source only deforestation-free commodities in their supply chains and help achieve net-zero deforestation by 2020. The TFA 2020, a public-private partnership established in 2012 at the Rio+20 Summit, aims to provide concrete guidance on how to implement the forum’s pledge.

As the old adage suggests, it is important to see the forests for more than just the trees. While an estimated 500 million people depend directly on forests for their livelihoods, the entire world depends on them for food, water, clean air, and vital medicines. Forests also absorb carbon dioxide, making them critical to curbing climate change.

Despite some encouraging anti-deforestation efforts in places like Brazil, Indonesia, and Africa, globally, forests are under threat, particularly in the tropics. Between 2000 and 2010, nearly 13 million hectares of forests were lost every year. About 30 percent of the global forest cover has been completely cleared, and 20 percent has been degraded.

This dilemma begs the question: What is the outlook for forests in 2030? Are we missing the opportunity to preserve forests and ensure they continue to deliver the goods and services we need for a growing global population? How can we use forests to build a thriving global green economy?

Asking these questions is important. Finding answers to the challenges they raise is imperative.

Asia Pulp & Paper (APP), one of the world’s largest paper companies, announced earlier this month that it will no longer cut down natural forests in Indonesia and will demand similar commitments from its suppliers. The announcement was received with guarded optimism by Greenpeace, Rainforest Action Network, World Wildlife Fund, and other NGOs who have waged a persistent campaign to change APP’s forest policies.

Indeed, APP’s new policy—which includes sourcing all material from plantation-grown trees, ceasing clearing of carbon-rich peatland, and engaging more with local communities—is significant, both for the business world and forest conservation. APP and its suppliers manage more than 2.5 million hectares of land in Indonesia and produce more than 15 million tons of pulp, paper, and packaging globally every year. Strong action by APP could indicate that the industry is heading for a more sustainable future.

The question is whether APP will follow this positive announcement with action. The company does not have a strong track record, having defaulted on past commitments to end deforestation.

But APP has something else going for it this time around. A rapidly evolving world of improving corporate practices and powerful technology could provide the right enabling environment for APP’s commitment—and others like it—to succeed.

Forests are vitally important for the global environment, economy, and population. The forest sector employs 13.7 million workers and contributes to about 1 percent of the global GDP. Plus, an estimated 500 million people around the world directly depend on forests for their livelihoods.

But forests are also under threat. From 2000-2010, about 15 million hectares of the world’s forests were cleared, and a 2004 assessment estimated that 8-10 percent of the global wood trade is of illegal origin. In addition to deforestation, illegal logging can cause government revenue losses, poverty, unfair competition with legally sourced goods, unplanned and uncontrolled forest management, conflicts, and other illicit activities that can occur in instances where illegal logging’s proceeds are linked to organized crime and corruption.

But there are solutions. One way to improve forest management across the globe is for businesses, governments, and citizens to seek out and demand sustainably harvested wood and paper products.

On August 6, the U.S. Department of Justice announced that it reached a criminal enforcement agreement with Gibson Guitar Corp., resolving two investigations into allegations that Gibson violated the Lacey Act by purchasing and importing illegally harvested wood materials into the United States from Madagascar and India. Because this is the first major set of investigations to be publicly resolved under the new amendments to the Lacey Act, the agreement will help set precedents important to the U.S. and the global wood products industry. The announcement puts to rest nearly three years of investigation and speculation, and it has significant implications for future implementation of the Lacey Act and forest legality regulations across the world.

Today, WRI and the WBCSD release an update to the guide “Sustainable Procurement of Wood and Paper-Based Products.” The guide is meant to help company managers—who are charged with making large purchases of wood and paper products but may not have the time or the knowledge to navigate all the different resources— as they develop and implement their procurement policies.

What’s new?

We have updated the sections on legality and the listing of useful resources, which we call the “guide to the guides." The 12 resources that we highlighted when the guide was first published three years ago have now increased to 47. Resources include publications, projects, rating systems, procurement policies that help people develop and implement forest procurement policies.